Embodiments of the present invention are directed to systems, apparatuses and methods for enabling electronic payments and the processing of payment transaction data, and more specifically, to the authorization of a transaction based on the reputation of a node in the payment network or based on payment device, consumer data, or other information collected as part of a previous transaction. The inventive apparatus and associated systems and methods may be used to expedite the authorization of a transaction by associating the payment device, account or individual involved in a transaction with a previously authorized transaction, or with a merchant or other participant to the transaction that has previously determined that the payment device, account or individual is a reliable party to a transaction.
Consumer payment devices such as debit cards or credit cards are used by millions of people worldwide to facilitate various types of commercial transactions. In a typical transaction involving the purchase of a product or service at a merchant location, the payment device is presented at a point of sale terminal (“POS terminal”) located at a merchant's place of business. The POS terminal may be a card reader or similar device that is capable of reading or accessing data stored on the payment device, where this data may include identification or authentication data, for example. Some or all of the data read from the payment device is provided to the merchant's transaction processing system and then to the Acquirer, which is typically a bank or other institution that manages the merchant's account. The data provided to the Acquirer may then be provided to a payment processing network which processes the data to determine if the transaction should be authorized by the payment processor, and assists in the clearance and account settlement aspects of the transaction. The authorization decision and clearance and settlement portions of the overall transaction may also involve communication and/or data transfer between the payment processing network and the bank or institution that issued the payment device (the Issuer). Transactions in which a consumer payment device is presented to a merchant or accessed by a point of sale terminal are termed “card present” transactions since the payment device is in the same physical location as the merchant or terminal.
A transaction involving the purchase of a product or service may also be initiated by a consumer by providing payment data from a remote location to a merchant over a network such as the Internet, typically using a computing device such as a personal computer or laptop computer (termed a “card not present” transaction). Transactions may also be initiated by using a mobile device such as a cell phone or PDA that communicates with a merchant or service provider directly or indirectly over a wireless network (which may be configured to enable data transfer between the wireless network and the Internet). Thus, payment information for a transaction may be provided using a payment device and point of sale terminal, remotely located computing device, or mobile device capable of wireless communications, among other methods.
Each element or participating node in the authorization process for a transaction may have its own information about the user. For example, a merchant may have records of the consumer's transaction history with that merchant, while the payment processor or Issuer may have access to identification data for the payment device being utilized, the consumer's account status, the consumer's overall transaction history, or consumer identification or security data. Further, each participant in the authorization process will typically have its own criteria for determining if authorization of the transaction is warranted at that stage in the overall authorization process.
Some of the data, such as the consumer data, payment device data, or point of sale terminal or consumer computing device data is typically not shared between the elements or nodes of the transaction authorization network. As a result, transactions initiated by the same consumer using different computing devices or by the same consumer with different merchants require the same authorization process, even though the consumer may have demonstrated that they are reliable when their entire payment and transaction history is considered. This delays acceptance of a consumer, consumer's account, or consumer's device as a reliable party to a transaction by the elements of the transaction authorization network, where more rapid acceptance would decrease the data processing and time required for transaction authorization. It may also prevent a merchant from accepting a transaction from a consumer that the merchant is familiar with and finds reliable, even though another node of the authorization network might decline to accept the transaction.
In an E-commerce environment in which a credit card or debit card is typically not presented to a merchant, authorization of a transaction initiated using a consumer device may be contingent on the device or the account being used for the transaction having a sufficient history of being used for successful transactions (i.e., not fraudulent or questionable transactions). In the absence of a sufficient transaction history, the consumer may be denied authorization for a transaction initiated using a new device (such as a new computer or mobile phone) or account, or issued a challenge message that they must respond to in order for the authentication process to continue. In addition to the data processing burden this places on the payment network, this can frustrate a consumer and have a negative impact on their use of the payment network for future transactions.
What is desired is a system, apparatus and method for expediting the authorization process for electronic payment transactions. Embodiments of the invention address these problems and other problems individually and collectively.